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Casey’s Strong Sales Performance Continues Through The 2nd Quarter

Casey’s General Stores, Inc. (Nasdaq: CASY) today reported $0.99 in basic earnings per share for the second quarter of fiscal 2012 ended October 31, 2011 compared to $0.51 for the same period a year ago. Year to date, basic earnings per share were $2.02 versus $1.27 for the same period last year. After adjusting for costs associated with the hostile takeover attempt by Alimentation Couche-Tard, Inc., basic earnings per share last year would have been $0.81 for the quarter and $1.62 year to date. We are pleased with the second quarter results, despite the continued challenges impacting our industry,” stated President and CEO Robert J. Myers. “We experienced a favorable gas margin and strong inside sales, resulting in a 15.6% increase in total gross profit.”

Gasoline—The Company’s annual goal is to increase same-store gasoline gallons sold 1% with an average margin of 13.5 cents per gallon. For the second quarter, same-store gallons sold were down 2.9%, adversely impacted by a 30.9% increase in retail gas prices from the same period a year ago. The favorable gasoline margin environment continued in the second quarter resulting in an average margin of 16.7 cents per gallon. “The average gasoline margin for the trailing four years is 14.2 cents per gallon,” said Myers. For the year, total gallons sold were up 6.1% to 755.9 million with an average margin of 16.9 cents, while gross profit rose 14.6%. Same-store gallons for the year were down 2.8%.

Grocery & Other Merchandise—Casey’s annual goal is to increase same-store sales 5.8% with an average margin of 32.8%. For the quarter, same-store sales rose 5.8% with an average margin of 32.5%. For the fourth consecutive quarter, the Company experienced double digit sales increases across all major areas of this category. As a result, total sales were up 15.8%. “Competitive cigarette pricing continued to impact the margin in the second quarter compared to the second quarter a year ago,” stated Myers. “However, our cigarette margin began to stabilize in the second quarter as we start to cycle against the more competitive landscape that began about a year ago.” Despite the margin pressure from cigarettes, gross profit dollars increased 14.3% for the quarter. For the six months ended October 31, 2011, same-store sales were up 6.0% with an average margin of 32.5%. Total sales for the year are up 15.5% to $723 million.

Prepared Food & Fountain—The goal for fiscal 2012 is to increase same-store sales 7.7% with an average margin of 61.8%. Same-store sales were up 14.2% for the quarter and 14.8% year to date. The average margin for the quarter was 59.5%, down from the same period a year ago, primarily due to a rise in commodity prices. “It is essential to have high quality prepared food offerings at competitive prices to meet the needs of our value oriented customer base,” said Myers. “This focus on our customers enabled us to increase sales by 20.2% and gross profit by 14.1% for the quarter, despite a decline in the margin,” said Myers. Year to date, total sales were up 20.6% to $252.7 million compared to the first six months last year, with an average margin of 60.4%.

Operating Expenses—Year to date, operating expenses increased 12.3% to $343.2 million. For the quarter, operating expenses were up 12.1%. After adjusting for the expenses associated with the unsolicited offer by Couche-Tard in the prior year, expenses increased 18.4% in the quarter and 17.8% at the six month mark. “The increase was driven primarily by operating 128 more stores this quarter and a $5.2 million increase in credit card fees compared to the same period a year ago,” stated Myers.

Expansion—The annual goal is to increase the total number of stores 4-6%. At the mid-year point, the Company had acquired 33 stores and completed 8 new-store constructions. “We are on pace to build approximately 30 stores by the end of the fiscal year,” said Myers. “The acquisition environment continues to be active, and we remain optimistic about our long-term opportunities.”

Dividend—At its December meeting, the Board of Directors declared a quarterly dividend of $0.15 per share. The dividend is payable February 15, 2012 to shareholders of record on February 1, 2012.

Casey’s General Stores, Inc.

Condensed Consolidated Statements of Earnings

(Dollars in thousands, except share and per share amounts)

(Unaudited)

Three months ended October 31,

Six months ended October 31,

2011

2010

2011

2010

Total revenue

$

1,782,518

1,349,519

$

3,656,350

2,711,546

Cost of goods sold (exclusive of

depreciation and amortization,

shown separately below)

1,519,600

1,122,142

3,126,650

2,250,198

Gross profit

262,918

227,377

529,700

461,348

Operating expenses

171,832

153,263

343,248

305,649

Depreciation and amortization

23,432

20,041

46,327

39,604

Interest, net

8,777

8,195

17,711

10,722

Loss on early retirement of debt

-----------

11,350

-----------

11,350

Earnings before income taxes

58,877

34,528

122,414

94,023

Federal and state income taxes

21,245

12,836

45,391

35,045

Net earnings

$

37,632

21,692

$

77,023

58,978

Earnings per common share

Basic

$

.99

.51

$

2.02

1.27

Diluted

$

.98

.51

$

2.01

1.26

Basic weighted average shares

outstanding

38,055,909

42,283,525

38,040,142

46,622,176

Plus effect of stock options

342,934

287,678

328,239

263,899

Diluted weighted average shares

outstanding

38,398,843

42,571,203

38,368,381

46,886,075

Casey’s General Stores, Inc.

Condensed Consolidated Balance Sheets

(Dollars in thousands)

(Unaudited)

October 31,

April 30,

2011

2011

Assets

Current assets

Cash and cash equivalents

$

86,200

$

59,572

Receivables

19,752

20,154

Inventories

159,868

159,200

Prepaid expenses

2,007

1,180

Deferred income taxes

11,393

10,405

Income taxes receivable

-----------

43,376

Total current assets

279,220

293,887

Other assets, net of amortization

11,801

11,721

Goodwill

104,386

88,042

Property and equipment, net of

accumulated depreciation of $818,012 at

October 31, 2011, and of $777,342 at April 30, 2011

1,302,983

1,217,305

Total assets

$

1,698,390

$

1,610,955

Liabilities and Shareholders' Equity

Current liabilities

Notes payable to bank

$

-----------

$

600

Current maturities of long-term debt

5,845

1,167

Accounts payable

203,185

215,675

Accrued expenses

78,523

77,058

Income taxes payable

1,236

-----------

Total current liabilities

288,789

294,500

Long-term debt, net of current maturities

673,466

678,680

Deferred income taxes

230,206

203,078

Deferred compensation

13,715

13,858

Other long-term liabilities

19,156

16,943

Total liabilities

1,225,332

1,207,059

Total shareholders' equity

473,058

403,896

Total liabilities and shareholders' equity

$

1,698,390

$

1,610,955

Certain statements in this news release, including any discussion of management expectations for future periods, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially from future results expressed or implied by those statements. Casey’s disclaims any intention or obligation to update or revise forward-looking statements, whether as a result of new information, future events, or otherwise.

Sales and Gross Profit by Product

(Amounts in thousands)

Six months ended

Grocery & Other

Prepared Food

10/31/11

Gasoline

Merchandise

& Fountain

Other

Total

Sales

$

2,666,412

$

722,987

$

252,681

$

14,270

$

3,656,350

Gross profit

$

128,009

$

234,950

$

152,501

$

14,240

$

529,700

Margin

4.8

%

32.5

%

60.4

%

99.8

%

14.5

%

Gasoline gallons

755,911

Six months ended

10/31/10

Sales

$

1,864,270

$

626,106

$

209,565

$

11,605

$

2,711,546

Gross profit

$

111,661

$

205,680

$

132,431

$

11,576

$

461,348

Margin

6.0

%

32.9

%

63.2

%

99.8

%

17.0

%

Gasoline gallons

712,117

Gasoline Gallons

Gasoline Margin

Same-store Sales Growth

(Cents per gallon, excluding credit card fees)

Fiscal

Fiscal

Q1

Q2

Q3

Q4

Year

Q1

Q2

Q3

Q4

Year

F2012

-2.7

%

-2.9

%

F2012

17.2

¢

16.7

¢

F2011

1.5

3.6

3.5

%

-1.9

%

1.6

%

F2011

16.4

14.9

13.9

¢

15.6

¢

15.2

¢

F2010

3.2

-0.7

-2.9

0.2

- 0.1

F2010

15.7

14.3

12.4

13.1

13.9

Grocery & Other Merchandise

Grocery & Other Merchandise

Same-store Sales Growth

Margin

Fiscal

Fiscal

Q1

Q2

Q3

Q4

Year

Q1

Q2

Q3

Q4

Year

F2012

6.2

%

5.8

%

F2012

32.5

%

32.5

%

F2011

2.0

6.9

5.8

%

4.8

%

4.6

%

F2011

32.8

32.9

30.9

%

32.1

%

32.2

%

F2010

6.4

1.9

1.7

3.1

3.3

F2010

34.3

34.1

32.7

33.1

33.6

Prepared Food & Fountain

Prepared Food & Fountain

Same-store Sales Growth

Margin

Fiscal

Fiscal

Q1

Q2

Q3

Q4

Year

Q1

Q2

Q3

Q4

Year

F2012

15.3

%

14.2

%

F2012

61.2

%

59.5

%

F2011

2.4

7.2

10.5

%

11.8

%

7.7

%

F2011

63.8

62.7

62.1

%

60.2

%

62.2

%

F2010

6.6

3.4

1.4

5.3

4.2

F2010

63.8

64.6

62.8

64.1

63.8

Corporate information is available at this Web site: http://www.caseys.com. Earnings will be reported during a conference call on December 7, 2011. The call will be broadcast live over the Internet at 9:30 a.m. CST via the Investor Relations section of our Web site and will be available in an archived format.

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